LOS ANGELES (CelebrityAccess MediaWire) — The estate of Michael Jackson has been hit with a $702 million tax dollar bill after the Internal Revenue Service took them to tax court, alleging that the estate had undervalued some of Jackson's assets by hundreds of millions of dollars.
According to a report by Reuters, the dispute centers around a number of Jackson's assets, including the singer's image & likeness, as well as his recording assets. In 2009, the estate reported a taxable value of $7 million, putting the singer's image and likeness at a mere $2,105 and not ascribing any value at all to his recording assets. The IRS valued Jackson's likeness to be worth $434 million and estimated that the estate's stake in his recording assets were worth 469 million.
In May of 2009, the IRS issued a tax deficiency notice for $505.1 million in taxes and $196.9 million in penalties, though the estate is not required to pay any taxes or penalties unless the court rules in favor of the IRS.
While the IRS declined to comment on the case, a spokesman for Jackson's estate told Reuters that the IRS's appraisal "were based on speculative and erroneous assumptions unsupported by the facts or law."
The estate of pop music icon Michael Jackson's beneficiaries include Jackson's mother, Katherine, and his three children as well as a number of charities. – Staff Writers